Indigent dollars concern for counties

Funding indigent care at New Mexico hospitals is becoming a hot-button issue.

While the state and local governments agree funding it is a necessity, nobody can agree on who should pay for it.

County officials say they are being asked by the state to supply additional funding, which would force them to cut other indigent services in their communities to make up for a financial shortfall in the state’s new Safety Net Care Pool fund.

The fund, which replaced the Sole Community Provider program, will distribute money to rural hospitals for the indigent populations they serve with the help of a $3 to $1 federal match.

Hospital officials are concerned more cuts to local and federal dollars it receives to offset uncompensated care and treat indigent patients — which they are required to treat regardless of one’s ability to pay for services — will force them to slash staff and services, and even force some rural hospitals to close.

The Legislature’s latest attempt to evade hospital closures is a Senate bill that proposes counties be assessed a 1/12 percent gross receipts tax at the county level to make up for the pool’s funding gap.

This is a change from the 1/8 percent tax proposed, which county officials say would rid the county of its entire fund. Counties favor a much smaller tax increment of 1/16 percent.

PRMC Administrator Hoyt Skabelund said hospitals have already been hit hard with reductions in Medicare and Medicaid reimbursement rates.

“New Mexico payments from Medicare are already the lowest in the nation,” Skabelund said. “Some hospitals lose money with every Medicaid patient they treat. The fund sort of compensated for that.”

Skabelund said PRMC can receive a generous amount of help for the indigent population the hospital serves with the federal funds — about $5 million — because the new formula for the Safety Net Care Fund would largely base payouts by the Medicaid patients hospitals see.

Roosevelt General Hospital President Larry Leaming said there’s no question the funding gap needs to be solved.

Leaming said while RGH will certainly struggle if it doesn’t receive the indigent funds, he’s more concerned for the small rural hospitals on the eastern side of the state who are at risk of closing because of this issue.

“The state has to figure out how to fund the match,” Leaming said.

But while county officials see the importance of funding the pool, they say the state will do it at the county’s expense, taking the money from local indigent funds.

Roosevelt County Manager Charlene Webb said she thinks the state’s Human Services Department is threatening to cut funding to other programs, such as the DWI Program, if they don’t fork over the 1/8 percent tax.

“They’ve kind of put us in a corner,” said Webb. “What’s really frustrating about this is we did not screw this up. We’re going to suffer for the lack of decision making.”

Curry County Manager Lance Pyle said if the state intercepts the 1/8 percent tax collected, it would leave no money for the county to operate its indigent program. It pays for other primary health care clinics to include dental services as well as indigent burials.

“My feeling is this tax was passed locally and it’s collected locally. I think local government should have control on how those funds are spent in their communities as the funds are generated locally,” Pyle said. “It’s a very important issue, right now going through the session, it is the biggest issue for Curry County.”

Curry County commissioners angrily passed a resolution Friday, asking the state to work with them in solving the indigent funding issue.

“We’ve been using it to take care of our indigent health care and now they’re going to take it,” said Commission Chair Frank Blackburn.

The resolution included figures to show the state that Curry County must continue to receive a 1/16 percent increment of the tax in order to continue to provide the required indigent services to the community, the equivalent to $590,000.

The commissioners passed the resolution with four votes for it and one abstention from Commissioner Tim Ashley, who said the state’s proposal takes a way the county’s authority to negotiate with its own hospital.

If the state were to take the full 1/8 percent tax, Pyle said the county would be granted taxing authority to compensate for the loss of indigent funds, but the commissioners know proposing new taxes will not be popular.

“Passing the buck is what this is,” Blackburn said.

La Casa clinics in Curry and Chaves counties are supported through those counties’ indigent funds.

La Casa CEO Seferino Montano said with the exception of the hospitals, there will be no money for indigent care if HSD obtains the 1/8 percent tax from the counties.

Montano said La Casa is looking at a possible $750,000 loss, which could result in layoffs.